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BRIEFING PAPER Number 8339, 20 June 2018

Brexit: Negotiations Update (March-June 2018)

By Sylvia de Mars

Contents: 1. The draft Withdrawal Agreement 2. The Future Relationship (Political

Declaration)

2 Brexit: Negotiations Update (March-June 2018)

Contents Summary 3

1. The draft Withdrawal Agreement 4 1.1 Data Protection 5 1.2 Geographical Indications 5 1.3 Ongoing Police and Judicial Cooperation in Criminal Matters 6 1.4 Ongoing Union Judicial and Administrative Procedures 7 1.5 Governance of the Withdrawal Agreement 8 1.6 The Protocol on Ireland and Northern Ireland 9 1.7 The Protocol on the Sovereign Base Areas in Cyprus 11 1.8 Next Steps 11

2. The Future Relationship (Political Declaration) 13 2.1 Negotiations on Data Protection in the Future Relationship 15 2.2 Negotiations on the Future Security Partnership 17

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Summary The March 2018 draft Withdrawal Agreement published by the Commission made clear that while there was agreement between the UK and the EU on significant portions – approximately 75% - of the Withdrawal Agreement, there were also still key areas where agreement had not yet been found. Separately, the European Council and the European Parliament released negotiating guidelines and a resolution on the ‘future relationship’ they envisage with the UK in March 2018. The Council’s document will form the basis of the EU’s side of the negotiations on the ‘political declaration’ that forms the other part of the Article 50 TEU package to be agreed between the UK and the EU on withdrawal.

In the negotiations, there are thus currently two issues at play simultaneously:

• Negotiations on the Withdrawal Agreement – these will produce a legally binding text that will need to be ratified by both the UK and by the EU Council of Ministers, and will then become binding upon both parties under international law.

• Negotiations on the ‘future relationship’ – these will produce a non-binding ‘political declaration’ that will outline, in broad terms, the shape of the ‘future partnership’ negotiations that the UK and the EU hope to conclude once the UK is no longer a Member State.

Both are required to be completed under the terms of Article 50 of the Treaty on European Union (TEU), though in practical terms the Withdrawal Agreement itself is of significantly greater importance and must be in a detailed, finished state by the end of 2018 so it can enter into force within the two-year Article 50 TEU window. The Political Declaration can be as detailed or as general as the negotiating parties determine in 2018, and could thus be a significant or limited factor in the shape of the next negotiations between the UK and the EU – but if the Withdrawal Agreement is not fully agreed and ratified by both parties by March 2019, the UK will not enter into a ‘transition’ period but simply ‘leave’ without a deal.

The EU made clear in early 2018 that it wanted substantial progress on the areas of ‘disagreement’ in the Withdrawal Agreement by the June 2018 European Council. The parties released a joint statement on the progress of the negotiations on 19 June 2018; that formal update is supplemented by commentary from the negotiating parties on the specific areas of negotiations that remain to be ‘agreed’ in this briefing paper.

Most of the information released between March and June 2018 on the state of negotiations has come from the EU, and that is reflected in this briefing note. The UK’s position of not offering a running commentary on the negotiations means that when information about the negotiations is made available, its source is usually the EU.

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1. The Withdrawal Agreement The starting point for analysis in this paper is the 19 March 2018 colour-coded draft Withdrawal Agreement presented by both the UK and EU negotiating teams. The draft Agreement is discussed in detail in this Commons Briefing Paper; of interest for this briefing paper are those areas in which disagreement between the parties remains.

On 19 June 2018 the EU and UK released a joint statement on progress in the negotiations (addressing the Withdrawal Agreement specifically). It identified the following areas as those in which a final ‘text’ of the Withdrawal Agreement has not been agreed:

Areas outstanding

6. Both Parties have engaged on outstanding issues concerning the protection of data processed before the end of the transition/implementation period ('period'), geographical indications, the treatment of ongoing police and judicial cooperation in criminal matters, the finalisation of ongoing Union judicial and administrative procedures at the end of the period and possible new procedures concerning facts arising before the end of the period, consistent application and interpretation of the Agreement by both the Union and the UK and dispute settlement.

Progress on the protocols to the Agreement

7. On Northern Ireland and Ireland, scoping work has continued on the full range of provisions in the Protocol, in the context of both parties’ commitment to the Belfast or Good Friday Agreement in all its parts. Both Parties recognise that the backstop on Ireland/Northern Ireland requires provisions in relation to customs and regulatory alignment in line with paragraph 49 of the Joint Report of December 2017. Discussions were held on the UK proposal of 7 June which aims at addressing the customs aspects of the backstop. The finalised results of the North-South mapping exercise on cross border cooperation will be published shortly. The Parties are committed to accelerating work on the outstanding areas, noting that both Parties agree the scope of the draft Protocol reflects the issues that require legally operative agreed text in the Withdrawal Agreement.

8. On the Sovereign Base Areas in Cyprus, both Parties have confirmed their commitment to establish appropriate arrangements for the SBAs, in particular with the aim to protect the interests of Cypriots who live and work in the SBAs following the UK’s withdrawal from the Union, in full respect of the rights and obligations under the Treaty of Establishment. The Parties have made progress in agreeing the text of the Protocol that will give effect to this.

The next sections will consider comments made by the negotiating parties and other commentators on the issues raised above, where available.

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1.1 Data Protection The UK on 23 May 2018 published a presentation on data protection post-Brexit, arguing for an agreement to be concluded on the matter of data protection specifically. It reveals the following about the ongoing negotiations regarding the Withdrawal Agreement, however:

Adequacy Decisions allow the European Commission to recognise formally that a third country provides data protection standards that are “essentially equivalent” to those applied in the EU, and so personal data can flow freely without additional safeguards. Thus adequacy provides a legal basis that enables the free flow of personal data from the EU to a third country.

The standard adequacy approach is informing the UK’s approach to negotiations on the Withdrawal Agreement. It is important that the UK and the EU continue to protect the data and information exchanged before the end of the Implementation Period and on the basis of the Withdrawal Agreement to appropriate standards. The UK is willing to protect this data and information to a standard that is at least “essentially equivalent” to the level of protection in the EU at the end of the Implementation Period.

As we will see in Section 2.1 below, the European Council negotiating guidelines on the future relationship make clear that ‘adequacy’ as a regulatory regime is available to the UK post-Brexit. If acceptable to the EU for the purposes of the transition period, this may no longer be an area of disagreement in the negotiations for the Withdrawal Agreement (even if it remains an area of significant disagreement regarding the future relationship, as discussed below).

1.2 Geographical Indications A report by the Guardian on 28 May suggests that negotiations on geographical indications (GIs) in the Withdrawal Agreement are ongoing:

Barnier has said geographical indications are among the issues that must be settled before the UK can have an exit deal, including a 21-month transition period.

But after fractious talks in Brussels last week, a senior EU official said they were proving to be another “difficult issue ... where the UK has no position”.

GIs, in short, are intellectual property agreements that set out that only products from specific regions can be marketed using specific names; in other words, ‘champagne’ has to come from the Champagne region in France to be called that, and ‘feta’ cannot be a name adopted by Danish crumbly cheese.

The Guardian notes that UK might be holding off on revealing its position on whether it intends to maintain the EU’s GIs indefinitely for strategic reasons in these negotiations, in an attempt to use the EU’s

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desire for continued geographical indications as leverage for a concession on the EU’s side. In giving evidence to the Environment, Food and Rural Affairs (EFRA) Select Committee on 6 June, Minister Greg Hands made clear that this is indeed the current UK negotiating position: “Obviously there is a certain amount of leverage there for the UK, when you think about 3,355 EU GIs that they would like recognised in the UK market after the end of the implementation period. That is quite an interesting position for a negotiation.”1

Hosuk-Lee Makiyama, a former EU representative at the WTO, argues, however, that while willing to use GIs as leverage, the UK will not let this issue prevent the conclusion of a Withdrawal Agreement:

This is a legal and technical issue that is not straightforward [but] I don’t agree with the perception that it is thorny or a deal-breaker. It is actually one of the issues where we have shown a great amount of flexibility, but we have always compromised in the final wrap-up.

1.3 Ongoing Police and Judicial Cooperation in Criminal Matters

The parts of the draft Withdrawal Agreement that deal with ongoing judicial cooperation in criminal matters remain ‘white’ in parts, signalling disagreement about ongoing judicial cooperation (Article 58) and ongoing law enforcement cooperation (Article 59).

A UK technical note on ‘Other Separation Issues’ published in March sets out the UK position as follows:

20. In the December Joint Report, both parties agreed that there is a clear need to provide legal certainty and clarity in criminal matters. The UK and the EU broadly agree on the principle that all structured and formalised cooperation procedures ongoing on the day of withdrawal and which have passed a certain threshold (to be defined) should be completed under Union law.

…

23. It is important that there is a clear process for cases already underway in this area at the point of exit. The UK will continue to press for certainty in this area as a means of minimising operational disruption for individuals, and for law enforcement and judicial bodies.

It is unclear what the source of disagreement in this area is; it could be disagreement regarding the ‘threshold’ indicated above, but neither party has expressly commented on the content of Articles 58 and 59 of the draft Withdrawal Agreement in negotiation updates delivered since March.

In a press statement following negotiations delivered on 8 June 2018, Michel Barnier does not specifically indicate cooperation in criminal

1 Q.108.

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matters as an area on which there is still ‘a lot of work to be done’. This may mean that it is instead one of the subjects that he anticipated on 8 June that would be ‘resolved’ before the June European Council meeting – but the 19 June 2018 joint statement still highlights it as an area where disagreement exists.

1.4 Ongoing Union Judicial and Administrative Procedures

Title X of the draft Withdrawal Agreement remained completely ‘white’ in March, suggesting substantial disagreement between the UK and the EU on the resolution of ongoing EU judicial and administrative processes at the end of the Withdrawal Period. The UK’s technical note on ‘Other Separation Issues’ from March gives an idea of which aspects of the text produced by the Commission it disagrees with.

On judicial procedures, the technical note states:

8. The UK expects to be able to reach agreement on the few remaining issues during the next round of technical discussions, having made good progress during the previous phase. In particular, the UK and the EU will need to discuss the role of the UK at the CJEU in the period during which pending UK cases are being heard, in order to agree in which cases the UK can intervene, and the rights of representation for UK lawyers at the CJEU. The UK will seek to ensure that it can continue to be involved in cases before the Court which may have a read across to UK cases, and to ensure that there is continuity and certainty for parties represented by UK lawyers.

The primary objection highlighted here appears to be to Articles 85 and 86 of the draft Withdrawal Agreement, which limits the ability for the UK to intervene and for UK lawyers to represent at the CJEU to cases that have commenced before the end of the transition period. The latter request made by the UK, of involvement in cases before the Court that ‘may have a read across to UK cases, is not addressed by the draft Withdrawal Agreement.

On administrative procedures, the technical note states:

9. In the December Joint Report, both parties deepened their understanding of the respective positions in relation to ongoing administrative procedures, and explored some areas, such as competition, state aid and examinations of the Community Plant Variety Office.

…

12. There are many different categories of administrative procedures, and different administrative procedures will follow different processes. The UK has made clear that a single approach is unlikely to be appropriate or desirable.

The draft Withdrawal Agreement in Articles 88-91 appears to suggest that all EU administrative procedures currently applicable to the UK will

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continue to be applicable to the UK during transition, and as long as ‘initiated’ before the end of transition, will be resolved in line with existing EU law and processes after transition. It is not clear what the UK’s opposition to the draft text is, as it appears to reflect a multitude of administrative processes; one possible concern, however, is that under Article 91, the CJEU oversees the enforcement of these administrative processes against the UK, as this may conflict with UK red lines on ending CJEU jurisdiction.

Whatever the disagreement is, Michel Barnier emphasised in his 8 June 2018 negotiations update statement that obtaining agreement on ongoing judicial and administrative processes is not a trivial matter in the view of the EU:

This is not a bureaucratic point. This is a point which concerns the financial interests of the Union.

1.5 Governance of the Withdrawal Agreement The final issue raised as an ‘area outstanding’ in the 19 June 2018 joint statement on progress in the negotiations is ‘consistent application and interpretation of the Agreement by both the Union and the UK and dispute settlement’. On 8 June, Michel Barnier described those concerns as being about ‘governance’ of the Withdrawal Agreement.

A speech at the International Federation for European Law (FIDE) on 28 May marked the first time he has spoken in detail about the difficulties in reaching agreement on the governance structures of the Withdrawal Agreement:

We … need strong institutions to ensure the correct application of the agreement by both parties. And we need a solid dispute settlement mechanism.

So far, we have reached an agreement with the UK negotiators on the existence and functioning of a mixed committee which is, as you know, a classic institution in agreements concluded by the European Union and which represents a forum for political dialogue between the parties.

But in no circumstances is it sufficient to ensure the appropriate governance of the Withdrawal Agreement.

The remainder of the speech sets out the three conditions on which the UK and EU diverge. The first of these is overall institutional structure. Barnier notes that the British position is that the Joint Committee overseeing the Withdrawal Agreement will deal with all disagreement and dispute resolution. He notes here that, ‘For us, on the EU side, it is essential to settle disputes in a legal or arbitration-based framework. This is a question of legal certainty and efficiency.’

The second area of divergence relates to the role of the Court of Justice of the European Union (CJEU) in administering the Withdrawal Agreement. For the EU, the Withdrawal Agreement is heavily rooted in EU law – the concepts and provisions in the Agreement are all inspired

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by, if not directly drawn from, EU law. Barnier stresses that per long-standing CJEU jurisprudence, the EU ‘cannot accept that another jurisdiction, other than the Court of Justice of the European Union, says what [EU] law is, or imposes its interpretation on the institutions of the Union.’ The UK position in the negotiations , however, has been to retain ending the CJEU’s jurisdiction in the UK as a ‘red line’ (except in those situations where the UK ‘opts in’ to a specific EU agency, as set out in the Prime Minister’s Mansion House speech).

The third area of divergence relates to the interplay between UK courts and the CJEU. Barnier notes that the preliminary rulings procedure, whereby UK courts can ask the CJEU for interpretations of EU law terms, will continue to operate for the Citizens’ Rights part of the Withdrawal Agreement for 8 years – but that the EU wishes to see preliminary rulings be possible for the entirety of the Agreement for a period of at least 8 years. It is implied that the UK is not amenable to extending this 8-year period to the remainder of the Agreement.

1.6 The Protocol on Ireland and Northern Ireland Speeches by Michel Barnier in April and May continued to stress that operationalising the commitments made regarding the Irish border in December 2017’s Joint Report remained unresolved between the negotiating parties. In a speech at the All-Island Civic Dialogue on 30 April, Barnier stressed that substantial progress on the ‘backstop’ option, or ‘full alignment’ between Northern Ireland and the EU to avoid a hard border, is needed by the June European Council, and he recalled that both parties had committed to such a ‘backstop’ option in December 2017. The EU’s own ‘backstop’ proposal remains as set out in the draft Withdrawal Agreement – but it was described as something to which ‘no United Kingdom Prime Minister could ever agree’ by the PM during Prime Minister’s Questions on 28 February 2018.

A number of proposals by the UK government to manage the UK’s border with the EU post-Brexit have been declared as not suitable by the EU for operationalising the December Joint Report commitments , as discussed in this briefing paper in more detail. While negotiations on the border will be ongoing until the June European Council, the UK has not yet made a proposal that is both acceptable to the UK Cabinet and to the EU.

The most recent proposal, sent to the EU on 7 June, proposes UK-wide membership of the Customs Union (and the EU rules on VAT) until an alternative solution to keeping the land border open can be found – which the government expects to be achieved by the end of 2021. It requests, however, that this extended Customs Union membership does not preclude the UK concluding Free Trade Agreements (FTAs) where these do not conflict with the EU Customs Union policies (eg, on tariffs). On 11 June, the Commission released a set of slides that were presented to the Council Article 50 Working Party on 8 June, and set out the EU

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reaction to the UK proposal. It contrasts what the UK is suggesting with ‘EU backstop proposal’, summarised as:

• Northern Ireland as part of the Union’s customs territory (no border)

• Full regulatory alignment on EU goods acquis in Northern Ireland

• Full EU supervision and enforcement mechanisms

The EU briefing notes that there are key unanswered questions in the UK proposal regarding governance, the operation of the EU’s Common External Tariff, and the very nature of a ‘backstop’, which cannot be time-limited. More generally, the EU slides highlight that (unlike the EU’s own proposal) the UK customs proposal does not address regulatory alignment, is not a back-stop if it is time-limited, and according to the EU, pre-determines the UK-EU future relationship by setting out a UK-wide policy. However, it does not categorically rule out the UK proposal in these slides; and the UK proposal itself acknowledges that it only addresses part of what is needed, noting that a further paper on ‘regulatory standards’ is forthcoming.

The current status of the negotiations on this Protocol are summarised by paragraph 7 of the 19 June 2018 joint statement:

Both Parties recognise that the backstop on Ireland/Northern Ireland requires provisions in relation to customs and regulatory alignment in line with paragraph 49 of the Joint Report of December 2017. Discussions were held on the UK proposal of 7 June which aims at addressing the customs aspects of the backstop. The finalised results of the North-South mapping exercise on cross border cooperation will be published shortly. The Parties are committed to accelerating work on the outstanding areas, noting that both Parties agree the scope of the draft Protocol reflects the issues that require legally operative agreed text in the Withdrawal Agreement.

The ’North-South’ mapping exercise referred to means that there is now a fuller picture of just what areas of law ‘full alignment’ will be needed in for a hard border to be avoided. However, this alone will not result in an agreed legal text, as is also stressed in a leaked draft of the European Council conclusions for the forthcoming June summit:

The European Council expresses its concern that no substantial progress has been achieved on agreeing a backstop solution for Ireland/Northern Ireland. It recalls the commitments undertaken by the UK in this respect in December 2017 and March 2018, and insists on the need for intensified efforts so that the Withdrawal Agreement, including its provisions on transition, can be concluded as soon as possible in order to come into effect on the date of withdrawal.

The options open for achieving a functional ‘backstop’ that respects the need for no physical infrastructure appear limited. The main issue commented on in June 2018 is whether such a backstop should be UK-

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wide, as the UK government has argued – or Northern Ireland-specific, as the EU reads the Joint Report as saying, and as Michel Barnier confirmed upon receipt of the 7 June 2018 UK customs proposal.

The Institute for Government recommended on 5 June that the UK government attempt to negotiate for UK-wide ‘full alignment’ in those areas of regulation that have been identified as affecting the land border, before then seeking a ‘better’ solution to the land border; however, Politico reports on 6 June suggest that the UK may be exploring a ‘Northern-Ireland-only’ backstop solution that would require border controls on goods moving from Great Britain to Northern Ireland.

1.7 The Protocol on the Sovereign Base Areas in Cyprus

The March draft Withdrawal Agreement contains a protocol on the Sovereign Base Areas (SBAs) in Cyprus, but the content of that protocol is limited to a ‘placeholder’ for mechanisms to ‘ensure the proper implementation of the applicable Union law in relation to the Sovereign Base Areas in Cyprus following the withdrawal of the United Kingdom from the Union’.

There have been no public updates or statements on the negotiations on this protocol from either negotiating party before the 19 June 2018 joint statement, which suggests that the ‘placeholder’ text is being developed but is not finalised at this time:

On the Sovereign Base Areas in Cyprus, both Parties have confirmed their commitment to establish appropriate arrangements for the SBAs, in particular with the aim to protect the interests of Cypriots who live and work in the SBAs following the UK’s withdrawal from the Union, in full respect of the rights and obligations under the Treaty of Establishment. The Parties have made progress in agreeing the text of the Protocol that will give effect to this.

1.8 Next Steps The 19 June 2018 joint statement concludes that:

The negotiators note that the progress recorded in this statement will contribute to the finalisation of the Withdrawal Agreement, taking account of the framework for the future relationship between the Union and the UK in accordance with Article 50. The negotiators commit to making progress as quickly as possible on all aspects necessary to reach such an agreement.

The leaked European Council conclusions appear to have been drafted on the assumption that the Withdrawal Agreement will not be concluded at the June European Council summit. The next summit where it could be concluded will take place in October 2018, but the Financial Times reports that officials from both the UK and the EU are

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suggesting that the Article 50 TEU negotiating process may not conclude until November or December.

The next section of the paper considers the extent to which agreement has been reached since March 2018 regarding the negotiating parties’ positions on the future relationship, which is the other aspect of the Article 50 TEU negotiations that must be concluded in advance of 29 March 2019.

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2. The Future Relationship (Political Declaration)

No formal draft ‘text’ for the Political Declaration on the future relationship has been released by either negotiating party to date. The information that is available about the state of negotiations in March comes from comparing three different sets of views on the future relationship:

• For the UK, the PM’s Mansion House speech, as supplemented by further specific speeches

• For the EU, the European Council guidelines on the framework for the future relationship

• And, also for the EU, the European Parliament’s resolution on the framework for the future relationship

In April, a Commons Briefing Paper examined these three documents and attempted to ascertain where there was divergence between the positions. Section 11 of that paper highlights that there remained substantial disagreement on the following areas of negotiation:

• Mutual recognition as a viable mechanism by which to govern future UK-EU trade and cooperation in both goods and services (specifically, financial services); and recognition of UK workers’ rights, environmental protection, and social standards as guaranteeing a ‘level playing field’.

• Data protection: the EU wants unilateral ‘adequacy’ rulings, while the UK wants a ‘firmer’ solution.

• Agency participation: the UK is willing to sign up to all EU rules and institutional enforcement in order to remain a party to certain EU agencies. The EU so far appears to be ruling out agency participation for non-Member States. But some EU agencies explicitly allow for third party status.

• Dispute settlement: the UK wants an arbitration system; the EU says a dispute settlement system must respect the depth of the partnership and the autonomy of the CJEU.

Given the extent of negotiation still needed to conclude the Withdrawal Agreement, it is perhaps unsurprising that far less information has been made available about the progress of the ‘future relationship’ negotiations. In one key update, the Commission has suggested, by means of a slide released in May 2018, that it is amenable to the UK proposals for a ‘several treaties’ pillared structure for the future relationship framework:

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2

Updates on progress within these identified ‘four pillars’ has been sporadic since March. In May and June, the Department for Exiting the EU (DExEU) released a number ‘framework’ policy papers that set out what the UK negotiating team will be aspiring to:

• Framework for the UK-EU Security Partnership

• Framework for the UK-EU Partnership Data Protection

• Framework for the UK-EU Partnership Science, Research and Innovation

• Framework for the UK-EU Economic Partnership

• Framework for the UK-EU Partnership: Transport

• Framework for the UK-EU partnership Civil judicial cooperation

• Framework for the UK-EU partnership Company law (accounting and audit)

These have been supplemented by so-called ‘technical notes’ on more specific aspects of the negotiations, such as UK participation in Galileo; security, law enforcement and criminal justice; consultation and cooperation on external security; the exchange and protection of classified information; and, most recently, data protection.

On 8 June, the Lords EU Committee published its own table of areas of agreement and disagreement, which takes account of these more recent and specific UK proposals.3 There have been no specific responses to most of these UK proposals in the form of Commission

2 The picture version of the Barnier slide is borrowed from the EC in UK. 3 The exception is the Framework Paper on Transport and the Technical Note on Data

Protection, as both were published after the Lords report was compiled (on 5 June 2018).

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negotiating documentation; however, Michel Barnier commented on their existence in general on 8 June 2018:

In all the UK papers that we have been receiving until now – which I read carefully with my team – there has been a request to maintain the status quo, a form of continuity, which is paradoxical seeing as the country decided itself to leave the European Union.

The United Kingdom seems to want to maintain the benefits of the current relationship, while leaving the EU regulatory, supervision, and application framework.

When we respond to UK leaders saying that these benefits are not accessible outside the EU system – because of their decision – some people in the UK try to blame us for the consequences of this.

I simply want to say that we will not be swayed, I will not be swayed, by this blame game.

This suggests significant disagreement between the negotiating parties on what will ‘fill in’ the four pillars identified for the future relationship.

The EU has published slides in response to the UK’s proposals on security and defence cooperation and police and judicial cooperation in criminal manners post-Brexit, and the UK’s proposals on data protection have been addressed by Michel Barnier in detail in a speech. These more detailed responses suggest a more ‘mixed’ picture of levels of disagreement between the EU and the UK regarding the future relationship; whereas the UK and EU positions on data protection remain far apart, the positions on security and defence cooperation post-Brexit appear closer, at least in some respects.

2.1 Negotiations on Data Protection in the Future Relationship

The most recent UK position on data protection post-Brexit was detailed in a set of slides prepared for the negotiations, dated 23 May 2018.

Speaking on 26 May at the FIDE conference, Michel Barnier explicitly rejected the UK’s May 2018 proposal for a data protection agreement that surpasses an ‘adequacy’ agreement such as the EU unilaterally extends to other non-Member States:

According to the United Kingdom's position first presented – and published – this week on data protection:

• The United Kingdom would like its supervisor to remain on the European Data Protection Board, created by the GDPR.

• It wants to remain in the one-stop-shop.

• It believes that this is in the interest of EU businesses.

But let's be clear: Brexit is not, and never will be, in the interest of EU businesses.

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And it will especially run counter to the interests of our businesses if we abandon our decision-making autonomy. This autonomy allows us to set standards for the whole of the EU, but also to see these standards being replicated around the world.

This is the normative power of the Union, or what is often called "the Brussels effect."

And we cannot, and will not, share this decision-making autonomy with a third country, including a former Member State who does not want to be part of the same legal ecosystem as us.

You are EU law experts, and you can see how the UK's ideas pose real problems:

Who would launch an infringement against the United Kingdom in the case of misapplication of GDPR?

Who would ensure that the United Kingdom would update its data legislation every time the EU updates GDPR?

How can we ensure the uniform interpretation of the rules on data protection on both sides of the Channel?

The United Kingdom needs to face up to the reality of the European Union. It also needs to face up to the reality of Brexit.

The United Kingdom decided to leave our harmonised system of decision-making and enforcement.

It must respect the fact that the European Union will continue to work on the basis of this system, which has allowed us to build a single market, and which allows us to deepen our single market in response to new challenges.

And, as indicated in the European Council guidelines, the UK must understand that the only possibility for the EU to protect personal data is through an adequacy decision.

It is one thing to be inside the Union, and another to be outside.

The UK has responded to some of Barnier’s concerns, it seems, in a 7 June 2018 ‘Technical Note’ on data protection. It stresses that a separate agreement on data protection ‘will not affect the EU’s ability to change its own data protection legislation, nor the EU’s decision-making autonomy’:

The UK is not seeking decision-making power over future EU laws, has no intention to impede EU policymaking in data protection, and respects the fact that certain EU bodies are subject to CJEU jurisdiction.

The remainder of the note stresses that having an agreement on data protection has numerous advantages over the unilateral ‘adequacy’ framework the EU extends to other third countries in negotiations, and that the UK-EU relationship warrants more stability than ‘adequacy’ because of the level of connectedness between the jurisdictions and a shared commitment to very high standards in data protection. It concludes that the UK is ‘willing to enter into a legally-binding agreement to guarantee effective future enforcement’, but also stresses

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that that legally binding agreement will not result in CJEU jurisdiction over the UK’s data protection regime:

… we can negotiate the right governance mechanisms for our future data relationship. This could include an agreed approach to the standards applied and their interpretation, and to enforcement and dispute resolution.

Barnier’s comments suggest that anything short of CJEU supervision (as part of signing up to the EU’s Single Market acquis) will not be enough to move beyond an ‘adequacy’ framework in the EU’s views, but if this is indeed the EU’s position, it will be further clarified over the course of the negotiations.

2.2 Negotiations on the Future Security Partnership The overarching UK position on security cooperation post-Brexit was detailed in a set of slides prepared for the negotiations, dated 9 May 2018. Aarti Shankar at Open Europe describes the UK proposals as ‘an ambitious model that goes beyond the EU’s existing third country agreements. It envisages three distinct pillars of cooperation: internal security, external security, and wider cooperation on topics such as cyber security, migration, and counter-terrorism.’

On internal security, the UK proposals ask for ongoing participation in the European Arrest Warrant (EAW) and the European Investigation Order (EIO), and an agreement to facilitate cooperation through EU agencies such as Europol and Eurojust. The UK is also seeking an agreement that will permit the sharing of classified information between the UK and the EU. It has expanded on the ‘internal security’ aspects of its Framework paper with a technical note on security, law enforcement and criminal justice.

On external security, as discussed in more detail in this Commons Briefing Paper, the UK suggests continued case-by-case participation in EU Common Security and Defence Policy (CSDP) operations and missions, noting it is willing to financially contribute to such operations in a manner proportionate to the capabilities it contributes. To support coordination of the future distinct UK and EU foreign policies, the UK suggests establishing regular structured consultations between the parties.

EU Responses: Internal Security Part of the EU’s response to the UK’s proposals on ‘internal security’ cooperation has come in the form of a set of slides published on 18 June 2018, addressing ‘Police and judicial cooperation in criminal matters’. The slides highlight that while there is a ‘shared understanding of [the] importance of close law enforcement and judicial cooperation’, and ‘[b]road convergence on the building blocks of the future relations’, the EU objects to the content of the EU’s

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proposals on future internal security cooperation.4 Specifically, the slides summarise the UK’s position as ‘sustaining operational cooperation on the basis of existing EU measures… BUT … different institutional framework (i.e. no [CJEU]) and different safeguards (i.e. on data protection, fundamental rights’.5

The EU’s response to the UK’s position objects to what it calls an asymmetry of rights and obligations: the UK appears to wish for ‘the same rights but different constraints than Member States’, which forms a ‘risk for [the] integrity of the [Justice and Home Affairs] area’.6 The UK, in other words, is asking for ‘core instruments of the [Justice and Home Affairs] acquis [to be] extended to a country outside of the EU framework, Schengen, safeguards and [CJEU] jurisdiction.’7 It reiterates its position on data protection here – where a third country can only operate on the basis of the unilateral ‘adequacy’ declaration model – and notes that there is a ‘potential risk of lowering the standards of protection for individuals’ in what the UK is proposing, given that it is leaving the Charter of Fundamental Rights upon leaving the EU.8

The EU’s own proposals stress this latter concern by making withdrawal from the ECHR a ‘guillotine’ clause for any future (internal) security partnership. It similarly sets out a ‘guillotine’ if the EU withdraws the UK’s data protection ‘adequacy’ decision, again reiterating its position set out above regarding future cooperation in data protection.9 The UK has not specifically responded to either of these suggestions, beyond announcing no intentions to withdraw from the ECHR during this Parliament, and wishing for a deeper relationship than ‘adequacy’ in data protection, as discussed in Section 2.1 above.

In summary, the EU finds that the UK and the EU agree on the importance of a continued internal security relationship, and also broadly agree on what aspects of internal security need to be covered – but the EU’s assessment of the UK’s detailed content for a future internal security partnership points to a number of problems in its view, primarily relating to the UK’s status as a third country and how that must come with proportionate rights and obligations, as well as CJEU oversight of any future internal security relationship.

Various commentators (including former Legal Counsel of the European Council and the Council of Ministers, Jean-Claude Piris) appear critical of the EU position as set out in the slides. Tim Durrant of the Institute for Government argues that the Commission appears to have unnecessarily intransigent ‘red lines’ on internal security matters. Professor Steve Peers stresses that the Commission’s response ‘fails to consider UK contribution of data, return of fugitives, etc. [It pays] lip

4 EU, ‘Police and judicial cooperation in criminal matters’ Slide Set (15 June 2018), p. 9. 5 Ibid, p. 10. 6 Ibid. 7 Ibid. 8 Ibid, p. 11. 9 Ibid, p. 7.

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service to security concerns, but [is] mostly concerned with ideological constructs.’ He highlights that it at points misstates the EU position on issues of Justice and Home Affairs and ignores that precedents exist of the EU letting Member States ‘opt in’ to Justice and Home Affairs measures, as well as concluding (partial) agreements with third countries in the area. Reinforcing Peers’ views about the substantial UK contribution made to internal security, Jeremy Fleming (the director of the UK surveillance agency known as ‘GCHQ’) made unprecedented public comments about the role the UK has played in helping secure the EU to date when visiting the NATO headquarters on 19 June 2018:

For example, we’ve played a critical role in the disruption of terrorist operations in at least four European countries in the past year. Those relationships, and our ability to work together, save lives. That will continue after Brexit, for the benefit of the UK and our partners across Europe.

Fleming’s intervention suggests that the UK will continue to press for more substantial database access and intelligence sharing in the future relationship between the UK and the EU than what the Commission has set out in its slides.

EU Responses: External Security and Defence In a speech on 14 May 2018 at the EU Institute for Security Studies, Michel Barnier welcomed ‘the UK’s commitment to Europe’s security, as restated in the recently published UK paper…’ This was followed by a description of how the EU envisages the future security partnership:

The UK has decided to leave the Union and become a third country. As a consequence, the UK will not have the same rights as EU Member States.

• It will no longer participate in the decision-making of the EU.

• It will no longer have the ability to shape and lead the EU's collective actions.

• British entities will no longer have the same rights as EU entities.

These are the legal mechanic consequences of Brexit. And the reality is that political and legal arrangements with a third country cannot be a substitute for all the benefits of EU membership. But our future partnership could be underpinned by a set of mechanisms – dialogue, consultation, coordination, cooperation, exchange of information.

…

First, close and regular consultations with the UK on foreign policy.

…

20 Brexit: Negotiations Update (March-June 2018)

Second, when projecting the EU's support worldwide, we will be open to the UK's contribution.

…

Third, in defence matters, the UK should have the possibility – where it will add value – to actively take part in a number of the European Defence Agency's Research and Technology projects.

…

Fourth, exchanging information on incidents will make us collectively more effective in fighting cyber-attacks.

…

Finally, this future relationship should be underpinned by a Security of Information Agreement between the EU and the United Kingdom. It will provide for the exchange and protection of classified information. It will facilitate the exchange of intelligence, as mentioned today in Berlin by Andrew Parker, the Chief of MI5.

There are clear areas of agreement in what Barnier says vis-à-vis what the UK has set out in its Framework paper on external security – notably, continuing consultation, exchanging information, and the establishment of a Security of Information Agreement.

However, there is significant disagreement about the possible ‘depth’ of the future (external) security partnership between the two parties. The UK wishes for an ambitious agreement in all respect that permits UK participation in and access to a variety of EU initiatives, including the Galileo navigation satellite programme and the European Defence Fund (for funding defence research and development). The EU responses to these types of requests have thus far been negative. Galileo became the focus of a significant disagreement between the UK and the EU in May, and the Commission unveiled proposals for new legislation on 13 June 2018 that would make it impossible for UK firms to bid for research under the European Defence Fund post-Brexit. David Davis has described these types of responses as the Commission ‘shooting itself in the foot just to prove the gun works’.

The UK has expanded on the ‘external security’ content of its Framework paper with technical notes on issues such as UK participation in Galileo and consultation and cooperation on external security. On 13 June 2018, the Commission directly responded to the Galileo technical note with a set of slides – ruling out unrestricted UK access to and participation in shaping Galileo following Brexit.

The EU has more generally responded to the UK’s position on a security partnership in a set of ‘Foreign, security and defence policy’ slides released on 15 June. It sets out the EU’s own position first and then compares that to what the UK is asking for in its Framework paper and technical notes, concluding that there is a ‘[j]oint commitment to a strong EU-UK cooperation in foreign, security and defence policy, though a number of UK requests are contrary to the parameters set in

21 Commons Library Briefing, 20 June 2018

the European Council guidelines.’10 Specifically, the parties agree on the scope of the relationship desired, but the EU expresses concerns about the specific mechanisms for participation and access the UK has set out, which in some cases requires the UK to be treated as if a Member State. The slides elsewhere note that the UK expresses a potential willingness to participate in EU defence initiatives, but offers no firm commitments, while asking for unlimited access to EU intelligence. These questions of ‘third party status’ and ‘asymmetry’ between rights and obligations as set out in the UK position suggest that the EU believes significant further negotiation to determine an appropriate level of UK participation in EU defence and security programmes is needed.

Participation in EU initiatives aside, it also remains to be seen whether there is full agreement on the legal structuring of the future security partnership and its governance: as just one example, the UK’s proposals rule out an ongoing role for the CJEU, but while Michel Barnier’s comments on security in the 14 May speech do not make this an explicit ‘red line’ for a security partnership, it is also not clear what oversight and enforcement mechanisms the EU will expect for such a partnership. The 15 June slides stress that the UK’s commitments such be ‘proportionate’ and reciprocal where possible, however, and that they are to be ‘formalised’ – suggesting that an oversight mechanism will have to be agreed upon by the parties.11 Further negotiations will have to shed light on the level of agreement the EU and the UK can reach on an ambitious future security partnership in both its detailed content and its organisation.

10 EU, ‘Foreign, security and defence policy’ Slide Set (15 June 2018), p. 19. 11 Ibid.

BRIEFING PAPER Number 8339 20 June 2018

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